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Hankook to Raise Prices 10%

Hankook Tire intends to increase operating profit by 32 per cent this year, a target it will reach through the increased sale of high performance tyres and by raising prices to counter higher raw materials costs. Chief financial officer Cho Hyun Bum told media in Seoul that the company intends to charge 10 per cent more for tyres, a necessary measure if it is to achieve its targeted 2008 profits of 348.5 billion won (£188.7 million). Last year the company made profits of 263.6 billion won (£142.7).

22nd February 2008/by Tyrepress Editors

Hankook Stock Jumps Following Morgan Upgrade

Hankook Tire’s share price has “jumped” 5.4 per cent following an upgrade from Morgan Stanley. The South Korea-based tyre manufacturer’s share price rose to 15,500 won at closing on 20 February, the largest gain since 18 December. The national Kospi index dropped 1.9 per cent. Morgan Stanley raised its rating on Hankook to “overweight”’ from “equal-weight”’ in a report dated today. “While the market seems nervous on higher raw material prices, we are more comfortable with the company’s ability to protect its margin,” Seoul-based market watchers, such as Jason Kang wrote. “The industry has been maintaining pricing power” through consolidation.

21st February 2008/by Tyrepress Editors

Hankook Maintains Strong Sales Growth & Profit Margins in 2007

Hankook Tire’s claim to be one of the world’s fastest growing tyre manufacturers was given a boost today by the release of its 2007 results. The South Korean company posted global sales of KRW 3.2 trillion (£1.77 billion) in 2007, an 11.8 per cent year-on year increase. Profit margin dropped slightly to 8.1 per cent while consolidated operating profit increased 5.1 per cent to KRW 263.6 billion (£144 million). While this latest profit margin is down 0.6 per cent on that recorded in 2006, Hankook defends the still respectable figure by pointing out that the previous year’s – and the current – margin was the highest amongst all major tyre manufacturers, last year’s outstripping the nearest competitor by two points.

Other milestones of note for the company include European sales – in the fourth quarter these increased by 9 per cent on the previous year – along with year-on year UHP tyre sales across all global markets; these increased 10.5 per cent. Hankook’s CEO believes his company’s efforts to build upon both product and brand quality has been instrumental in all such positive results.

11th February 2008/by Tyrepress Editors

Hankook Confirms News of VW OE Deal

Hankook has confirmed reports it has reached an agreement with Volkswagen for the delivery of 70,000 tyres per year as original equipment on the latest model VW Tiguan. Effective immediately, the compact Volkswagen SUV will leave the assembly line equipped with, amongst others, Hankook’s Dynapro HP tyre in size 215/65 R 16 H. The Hankook Dynapro HP is a high performance tyre intended predominantly, but not exclusively, for on-road use and was specifically designed for the ever more popular class of smaller yet powerful SUV vehicles such as the Tiguan.

The Hankook Dynapro HP – some sizes of which are produced at the company’s recently opened facility in Hungary – features a symmetric 5-rib pattern designed to provide excellent directional stability even at high speeds. The tie bars lying between the tread elements allow for enhanced lateral stiffness while improving dry braking performance. Hankook adds that they also, in combination with the tyre’s relatively tight block arrangement, offer greater circumferential stiffness and a reduced rate of wear.

31st January 2008/by Tyrepress Editors

Hankook Claims to be “Fastest Growing” Manufacturer

Hankook Tire claims it was, in terms of sales, the world’s fastest growing tyre manufacturer in 2007. The company’s sales for last year are estimated at US$3.5 billion, representing a year-on-year growth of 20.6 per cent. This contrasts markedly with Hankook’s nearest rival in terms of sales, Sumitomo Rubber, whose $3.6 billion in sales was down 5.3 per cent on last year’s $3.8 billion. Korean rival Kumho experienced a year-on-year growth of 15.8 per cent, making them the fourth fastest growing company according to the figures published by US magazine Modern Tire Dealer.

28th January 2008/by Tyrepress Editors

Apollo Offered £20 Million From Hungary

It has been reported that Apollo Tyres was offered HUF 7 billion (£20.2 million) in incentives from Hungary’s government to secure the country as the base for the Indian tyremaker’s new factory. If accurate, this figure published in the Budapest Times is far less than the almost £70 million approved by the European Commission for Hankook in 2007. According to Hungarian prime minister Ferenc Gyurcsány, the Apollo subsidy equals about two-thirds of the Hankook subsidy per employee.

23rd January 2008/by Tyrepress Editors

Hankook Sales Up, Ordinary Income Down in 2007

Hankook Tire reports positive sales and operating income results for 2007. The tyremaker has recorded sales of 2.253 trillion won (£1.2 billion), an increase of 9.2 per cent on its 2006 results. Operating income jumped 57.4 per cent from 174.54 billion won (£94.5 million) in 2006 to 274.79 billion won (£148.7 million) last year.

22nd January 2008/by Tyrepress Editors

Apollo in Europe: Neeraj Kanwar Speaks with Tyres & Accessories

In the coming months Apollo Tyres will establish a stronger foothold in Europe through the establishment of its first facility, the recently announced 200 million euro passenger car tyre factory to be built in Hungary. Only days after announcing this monumental step for the Indian manufacturer, Apollo Tyres’ joint managing director and COO Neeraj Kanwar spoke to Tyres & Accessories about the decision to enter Europe and what the future holds.

Firm news of Apollo’s intention to set up a European production facility was first made public in mid-November 2007, and several sites in Eastern Europe were scouted as potential factory locations; in addition to Hungary the company named Poland and Slovakia as contenders (media reports on potential sites in Germany were dismissed as unfounded). However, the first of these three locations proved most attractive to Apollo: “The decision was primarily on the basis of hard economic and commercial factors, based on which a total cost of delivering the final products to markets was derived,” Mr. Kanwar told Tyres & Accessories. “Hungary was very competitive.” Secondary reasons, including the region’s liveability and cultural openness, were also taken into consideration, he added.

18th January 2008/by Tyrepress Editors

South Korean Manufacturers Sign OE Deals

South Korea’s two leading tyre manufacturers have each entered into original equipment agreements with international manufacturers. The larger of the two deals has been signed by Kumho, who has agreed to supply 400,000 tyres to Chrysler for the company’s Dodge Journey SUV. The value of the agreement has not been disclosed.

The deal signed by Hankook also involves SUV tyres. The Korean company will supply 70,000 tyres for the Volkswagen Tiguan compact SUV. Again, financial details of the OE supply contract have not as yet been made available.

16th January 2008/by Tyrepress Editors

Apollo Invests 200 Million Euros in Hungary Car Tyre Plant

Apollo Tyres Ltd and Hungarian authorities have entered an agreement to build a passenger car radial tyre production plant with a first phase annual capacity of 7 million units. Phase one of the project is expected to be completed in 18 months time at a cost of 200 million euros. Hungarian Prime Minister, Ferenc Gyurcsany, and chairman & MD of Apollo, Onkar S Kanwar, met this morning, resulting in an “invitation” for Apollo to build the factory. The most likely site of the project is in Gyongyos outside Budapest city, Hungary.

The fact that Apollo describes the deal as an “invitation” and refers to the Hungarian Investment Agency as being “very helpful” suggests that public subsidies are involved. No details of this are currently available. However, when Hankook built its 500 million euro (£340 million) plant in Dunaujvaros, Hungary recently, it received approximately 20 per cent of the total investment in assistance. Roughly half of this was direct subsidy with the rest coming in the form of tax relief. An Apollo statement on the subject reports that the company has been evaluating various options for a European manufacturing hub to service the European and North American markets in a process that began about nine months back ago.

Commenting on the plans at a media briefing, Hungarian Prime Minister Ferenc Gyursacy said: “I am well aware of Apollo Tyres as a leading tyre manufacturer with a global expansion plan. We are very keen to have Apollo set up its first green field manufacturing unit, outside India, in Hungary. Apollo will bring to Hungary its world class manufacturing expertise, technology and people management skills.”

Onkar S Kanwar added: “So far, this is the largest investment made by any Indian company in Hungary. This manufacturing facility in Gyongyos, Hungary, will become our hub to service our passenger car radial customers in Europe and North America. This is a key investment in our global strategy. The Hungarian Prime Minister, the Investment Agency and all officials associated with this decision have been immensely helpful throughout our negotiations…Apollo Tyres is currently in a growth mode.”

According to Apollo, the European investment is designed to compliment Apollo Tyres’ planned investment in India. Yesterday, the Indian manufacturer’s board of directors approved 2.2 billion rupees for the construction of a world class greenfield radial facility in the recently acquired 135 acres of land in the Oragadam Industrial Park, outside Chennai city in Tamil Nadu. This investment is in the first phase of the project, which is also to be completed in the next 18 months.

16th January 2008/by Tyrepress Editors

Hankook Cleared of Heart Disease Charges

The South Korean Ministry of Labour has concluded that “no connection existed between multiple occurrences of heart disease and the working environment at a Hankook Tire plant in Daejeon,” according to a Korea Times report. The ministry told the presidential transition team in a briefing that though the workers at the plant “seem to have more heart disease than others,” but the relation between the alleged “deadly working environment’” could not be established. “We will do our best to improve the working environment no matter what the final report says,’” Hankook Tire spokesman Calvin Park said, welcoming the government announcement. “Workers will be provided with more specified and thorough health checks to prevent such mishaps in the future,’” he added.

9th January 2008/by Tyrepress Editors

Hankook Reaffirms Commitment to Vehicle Modification Group

As part of its commitment to motoring that is both enjoyable and responsible, Hankook Tire recently signed a contract at the Essen Motor Show confirming its ongoing partnership with the German tuning organisation VDAT. Vehicle tuning and modification enjoys a very strong following in this country and Hankook’s third consecutive year of support for the VDAT ‘Tune it! Safe!’ campaign sends a clear message that the manufacturer is fully behind those involved in the tuning scene – so long as the modifications made to vehicles are safe and legal.

10th December 2007/by Tyrepress Editors

Evans Achieves Wales Rally GB Class Win in Hankook Fiesta

Welsh rally star Elfyn Evans exceeded all expectations at the Wales Rally GB, taking his Hankook Fiesta to class victory. The 18-year-old son of former British Rally Champion Gwyndaf Evans produced one of the most impressive drives of the three-day rally – the Cardiff-based finale to the World Rally Championship.

Evans’ Fiesta ended the event in 42nd place overall, a massive climb from his start number of 118 and an indication of the young driver’s future potential. Together with co-driver Richard Edwards the pair faced 17 high-speed tests in the Welsh forests – tackling some of the worst conditions ever seen on Wales Rally GB. They had to contend with torrential rain, blanket fog and extremely muddy conditions, but nothing nature threw at them fazed the pair. And while many cars suffered punctures from the rocky tracks and body damage in the tough conditions, Elfyn and Richard successfully navigated everything in their path.

4th December 2007/by Tyrepress Editors

South Korean Agency Believes Hankook Factory Deaths Linked

According to a report published in South Korea’s The Korea Times newspaper, the Korea Occupational Safety & Health Agency reported on November 28 that the deaths of 15 workers at a tyre manufacturing facility in the South Korean city of Daejeon between May 2006 and October 2007 are seen to be a “collective outbreak.” This means, adds the paper, that a possible work related connection is seen between the deaths, as all occurred within a short time to employees working in the same area.

30th November 2007/by Tyrepress Editors

Hankook Announces US Market Price Increases

Hankook Tire America is increasing prices by as much as five per cent on its passenger, high performance and light truck tyre ranges, effective as of January 1, 2008. The exact amount of the increase will vary according to product line and/or size. Hankook cites rising raw material costs plus higher costs in transportation and general operating expenses as the key reasons for the increase.

30th November 2007/by Tyrepress Editors